Investing in a company that’s developing battery-powered trucks On Tuesday, after dipping earlier in the session due to two factors affecting the same important success criteria for the company—vehicle production in 2022—Rivian Automotive recovered and began rising.
Rivian Stock Falls Again as Production And Sales Woes Bite
At market open, shares of Rivian (ticker: RIVN) were trading down roughly 3%, below $78. Rodney Copes’ departure as COO of the company alarmed investors. On his LinkedIn page it simply indicated that he had retired from his position at Rivian.
Because it was unexpected, the market reacted strongly to the information early on Tuesday. In the days leading up to Tuesday, the corporation did not issue a statement or filing addressing the departure.
But, Rivian added, “Rod began a gradual retirement from Rivian some months ago, providing the team continuity as we went into production ramp.” We appreciate his help during a difficult period. Our leadership has taken over Rod’s responsibilities.
Jimmy Knauf and Charly Mwangi are two executives who may be involved in picking up those responsibilities. Knauf serves as Rivian’s vice president of facilities. A start date of November 2021 was set for him. Mwangi oversees manufacturing engineering as vice president. In May of 2020, he started at Rivian.
There appears to be a calming effect on the market as a result of the remark. In lunchtime trade, the share price rose 4.1%. About a 0.3 point increase for the S&P 500 and a 0.1 point increase for the Dow Jones Industrial Average were seen in early trading on Monday.
On Tuesday, 2021 production was another factor affecting the stock price. Production of Rivian’s initial product, the R1T pickup truck, is about to increase at the company’s first factory in Illinois. In 2021, the firm manufactured 1,015 automobiles. That falls short of the target set by the business. At the middle of December, CEO R.J. Scaringe stated the target production for 2021 was around 1,200 units.
Investors in Rivian will be keeping a close eye on the company’s production rate in 2018. Investors anticipate the company will ship out around 40,000 cars this year. That means increasing output from a few units per week to, say, 1,500 per week by the end of the year. As of that point, production must increase. In 2023, investors anticipate a total of around 100,000 shipments.
A Total of Around 200,000 Vehicles Per Year can be Produced at Rivian’s Factory in Illinois.
It has been a rough start to the year for Rivian shareholders. That’s another reason why the stock market doesn’t react strongly to unexpected information. Shares have fallen by nearly 21% so far this year as of Tuesday’s trade. All growth stocks have been affected by the rise in interest rates. Almost 4.5% of the Nasdaq Composite’s value has been lost.
At the low point of trading on Tuesday, shares of Rivian were selling for $78 apiece, or a little premium over their IPO price. This was a drop of approximately 55% from the stock’s 52-week high of over $180 apiece, which occurred in November.